PEFA is a globally accepted framework for assessing the performance of government’s public financial management systems, processes and institutions for achieving desired sustainable improvements in PFM practices. Government uses PEFA tool for diagnosing their own PFM weaknesses and strengths which pushed for reforms just like a treatment of diseases and maintain fit and healthy body. Subsequently, PEFA provides a foundation for PFM reform planning, dialogues on its strategy and priorities, and progress monitoring to achieve a sound PFM system.
Hence, the core objective of PEFA is to establish a good and strong PFM system in the country through continued PFM reform initiatives.
A good PFM system ensures and enables: (i) aggregate fiscal discipline by effective control of the total budget and management of fiscal risk; (ii) strategic allocation of resources by planning and executing the budget in line with government priorities aimed at achieving policy objectives; and (iii) efficient service delivery by using budgeted revenues (public money) to achieve the best levels of public services within available resources.
Nepal has made substantial progress in deepening the structures and processesof its public financial management marked in the second PEFA assessment reports 2015 throughreform initiations as suggested by the first PEFA assessment report in 2008. Now, the government of Nepal has approved second phase PFM reform strategy/Program to implement that are desired to contribute in the process of rebuilding the nation through reconstruction and rehabilitation. So, the PEFA Secretariat has a mission to lead for PFM reforms tostrengthen PFM system in sustainable way.